ALDI and East Towne are a study in contrasts

New development continues to flourish along Millertown Pike, while East Towne Mall, once a retail juggernaut, gradually fades away.

The German grocery chain ALDI is adding a new store at 5416 Millertown Pike, across from the ORNL Federal Credit Union near the intersection with Loves Creek Road. After the 2.25-acre site was cleared and graded, construction of the steel-frame building by Morgan Construction Co. began in late spring and is scheduled for completion this fall. This is the sixth ALDI location in Knoxville.

The chain is known for fresh foods, discounted items and healthy offerings including recipes and dietitian notes on its website. The ALDI stores nearest to the Millertown site are in Halls and on Kingston Pike in Bearden.

As ALDI’s presence blooms, East Towne retailers die on the vine. Belk is the latest big-box retailer to announce its intention to flee the mall, as soon as this November, joining an exodus of previous anchor tenants that included Sears, Dillard’s and JCPenney. With 15 stores closing in the past year, the mall is becoming a ghost town, due in part to a national trend away from brick-and-mortar retail and in part to the mall’s current bottom-feeding owner, which acquires distressed properties and sits on them rather than investing in their revival.

Anyone riding past the old Levi jeans mill along I-40 near downtown can see the decay that site has suffered. Broken windows and neglect are the order of the day. No rebirth has begun.

East Towne appears to be on a similarly dismal path. Several years ago, owner/manager Brent Enderle of Henry & Wallace commissioned an engineering study from Cannon & Cannon, showing plans for out-parcel restaurants and retail, new access points to the main building, an apartment complex and a redesigned road feeding the development traffic. That plan is apparently gathering dust while the property continues to decline. Ironically, the promotion of mixed-use development of that sort has gained traction in communities as close by as Farragut.

The problem? A reluctance to commit development funds upfront, even though interest rates are at historic lows. Purely speculative holding? Neglect? It amounts to a recipe for how to fail in retailing without even trying or, for that matter, without even starting.

The east side could use another Dewhirst. Opportunity exists for those bold enough to seize the reins.

Meanwhile, will the last retailer to leave East Towne please turn out the lights?

Nick Della Volpe is a lawyer and a former Knoxville City Council member.